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How Coffee Subscription Service,Tonx Got Bought by Blue Bottle Coffee

Ask anyone in the coffee business what they think about the quality of Starbucks coffee and you are pretty much guaranteed to get a strong opinion. One young company has taken the crusade for quality coffee to a new level. Their name? Tonx Coffee.

These guys, famous for offering ‘to exchange your Starbucks gift card balance dollar-for-dollar toward a Tonx Coffee subscription’, have spent the last three years ‘taking coffee seriously’ – and building a powerful brand in the process. Their hard work and innovative approach has seen a steadily increasing interest in their coffee subscription service. This service offers hard-core coffee lovers the chance to get fresh beans delivered to their door every two weeks. The effort has clearly paid off – It has just been been announced that Tonx is being acquired by powerhouse coffee startup, Blue Bottle Coffee.

We take a look below at what has made Tonx so successful.

Introducing Tonx

Almost three years ago, Tony Konecny, Nik Bauman, and Ryan Brown, a trio of joe aficionados, realized that roasting coffee was something they wanted to make a business out of. After they each spent several years working with and around coffee, they teamed up to start their very own roastery in Los Angeles. They eschewed the traditional route of starting their own coffee shop, choosing instead to found a coffee subscription startup (they’re not the only one, our UK readers can check out Pact Coffee, for example).

The deal is fairly simple: for $19, you’re mailed a 12 ounce bag. You’ll get a shiny new arrival every two weeks, allowing you taste a range of top quality coffees in the comfort of your own home.

But how does a mail order coffee roaster possibly compete against the convenience and squishy couches of the mega corporation of Starbucks? By accepting their gift cards, for one. But, more importantly, by appealing to smart coffee drinkers’ better judgement: make coffee at home, and get 24 superior cups, instead of 4 to 5 mediocre ones.

So, How Did Tonx Set About Standing Out?

By accepting Starbucks gift cards (a cost which they have to eat–they get nothing from them), they can easily rope in new customers.Note: If you’re thinking of implementing this tactic, you have to really back your product superiority, which of course you should if you’re in small business anyway

Their superior product, and arguably a great public relations strategy, keeps their brand viral and on the lips of the coolest coffee drinkers.

Like many great startups, (see: ShopKeep Merchants) they offer a ‘friend referral’ program that offers users free beans for getting their friends signed up. This is a widely used tactic in online marketing and yet totally underutilized by local stores and restaurants. Maybe it’s time for that to change?

All of their social accounts are active and their messages are consistently filled with enthusiasm for what they’re doing. They are passionate about their product and that authenticity cuts through with their target demographic.

So, What can Counter Culture readers learn from the success of Tonx?

The main message that Tonx’s success sends to hopeful entrepreneurs is that you can fight back against chains. It takes grit and determination. And, it also doesn’t hurt to follow the tactics of the megabrands like Apple, by encouraging a feeling of elite membership among your customers. Here are some of the key takeaways:

If you have to make a decision between variety and quality of your product, always pick quality. It’s easier to remembered for one great, stand-out thing, than a multitude of ‘pretty good’ offerings.

Psychology matters. People want to be part of a group, and validated as being different and unique. Make your brand a club, not just a label.

Be consistent in your branding. Decide on your brand’s personality early on, and stick with it. Your customers will subconsciously imagine your brand as an individual. Make sure you’re a trusted friend, not a salesperson.

Paul Nugent is a small business advocate with extensive experience in retail and the technology start up space. He is the editor-in-chief of Counter Culture and oversees all ShopKeep content production.